Jacob Balash v. Steve Mader ( 2024 )

IN THE
Court of Appeals of Indiana
Jacob Balash and Jonathan Balash, FILED
Oct 08 2024, 9:12 am
Appellants-Defendants,
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
v.
Steve Mader,
Appellee-Plaintiff.
October 8, 2024
Court of Appeals Case No.
24A-SC-792
Appeal from the
Owen Circuit Court
The Honorable
Darrin M. Dolehanty, Senior Judge
Trial Court Cause No.
60C02-2310-SC-116
Court of Appeals of Indiana | Opinion 24A-SC-792 | October 8, 2024 Page 1 of 9
Opinion by Senior Judge Baker
Judges Vaidik and Brown concur.
Baker, Senior Judge.
Statement of the Case
[1] In this home improvement case, Jacob and Jonathan Balash (the Balashes)
appeal the court’s judgment entered in favor of contractor Steve Mader,
claiming it is contrary to law. Specifically, the Balashes contend the small
claims court’s award of damages to Mader is erroneous because Mader failed to
provide the Balashes with a written contract in accordance with the Home
Improvement Contracts Act. Concluding that Mader’s dealings with the
Balashes fell within the scope of the Act and that Mader consequently cannot
recover damages from the Balashes, we reverse with instructions.
Facts and Procedural History
[2] The facts most favorable to the judgment are that in the spring of 2023, the
Balashes hired Mader to drill a new well on their property and cap off the
existing well for an estimated cost of $10,000 - $15,000. There was no written
agreement memorializing the work to be done, the cost of such work, or any
details associated with the project. Mader began work on the new well at the
end of June. Complications ensued with the drilling of the new well, and
Mader was unable to complete the work. He stopped work in mid-July, and the
Court of Appeals of Indiana | Opinion 24A-SC-792 | October 8, 2024 Page 2 of 9
Balashes hired a different contractor to install a new well and cap both the old
one and the one Mader had begun drilling.
[3] At the beginning of August, Mader returned to the Balash property to discuss
payment for the work he had done, but the parties did not reach an agreement.
The following month the Balashes received an invoice from Mader in the
amount of $8,280. Although the Balashes made an offer to settle, Mader
ultimately filed this action in small claims court. Following a bench trial, the
court entered judgment for Mader in the amount of $8,280 plus court costs.
The Balashes moved to correct error, which the court denied. This appeal
ensued.
Discussion and Decision
[4] Small claims actions involve informal trials where the sole objective is to
dispense speedy justice between the parties according to the rules of substantive
law. Harvey v. Keyed In Prop. Mgmt., LLC, 165 N.E.3d 584, 587 (Ind. Ct. App.
2021), trans. denied. We will reverse the judgment of a small claims court only
upon clear error. Wang v. Sun, 212 N.E.3d 1252, 1256 (Ind. Ct. App. 2023). In
our review, we consider only the evidence most favorable to the judgment, and
we neither reweigh the evidence nor assess witness credibility. Nick’s Packing
Servs., Inc. v. Chaney, 181 N.E.3d 1025, 1028 (Ind. Ct. App. 2021). However,
this deferential standard does not apply to substantive rules of law, which we
review de novo. Wang, 212 N.E.3d at 1256.
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[5] The Balashes contend the court’s judgment in favor of Mader is clearly
erroneous because Mader’s claim is based on an oral agreement for residential
real property improvements in violation of the Home Improvement Contracts
Act. See Ind. Code §§ 24-5-11-1 to -14. As this Court has explained,
[t]he purpose of the Act is to protect consumers by placing
specific minimum requirements on the contents of home
improvement contracts. . . . [F]ew consumers are knowledgeable
about the home improvement industry or of the techniques that
must be employed to produce a sound structure. The consumer’s
reliance on the contractor coupled with the well-known abuses
found in the home improvement industry, served as an impetus
for the passage of the Act, and contractors are therefore held to a
strict standard.
Benge v. Miller, 855 N.E.2d 716, 720 (Ind. Ct. App. 2006) (internal citations
omitted).
[6] Within the Act, a “consumer” is “a person that owns, leases, or rents the
residential real property that is the subject of a real property improvement
contract.” I.C. § 24-5-11-2 (2017). The Act defines “real property
improvement” as “any alteration, repair, replacement, reconstruction, or other
modification of residential real property.” I.C. § 24-5-11-3(a) (2017). In
addition, a “real property improvement supplier” is defined as “a person who
engages in or solicits real property improvement contracts whether or not the
person deals directly with the consumer.” I.C. § 24-5-11-6 (2017). And the Act
defines a “real property improvement contract” as “an agreement, oral or
written, between a real property improvement supplier and a consumer to make
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a real property improvement and for which the real property improvement
contract price exceeds one hundred fifty dollars ($150).” I.C. § 24-5-11-4
(2017).
[7] The heart of the Act, Section 24-5-11-10(a), mandates that suppliers provide a
completed contract to the consumer before it is signed by the consumer. The
section further requires that the contract contain, at a minimum:
(1) The name of the consumer and the address of the real
property that is the subject of the real property improvement.
(2) The name, address, and email address of the real property
improvement supplier.
(3) The name, telephone number, and email address for each
owner, officer, employee, or agent of the real property
improvement supplier to whom consumer problems and inquiries
can be directed.
(4) The date the real property improvement contract was
submitted to the consumer and any time limitation on the
consumer’s acceptance of the real property improvement
contract.
(5) A reasonably detailed description of the proposed real
property improvements.
(6) If the description does not include the specifications for the
real property improvement, a statement that the specifications
will be provided to the consumer before any work is commenced
under the real property improvement contract and that the real
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property improvement contract is subject to the consumer’s
separate written and dated approval of the specifications.
(7) The approximate starting and completion dates of the real
property improvements.
(8) A statement of any contingencies that would materially
change the approximate completion date.
(9) The real property improvement contract price.
(10) A statement as to whether any third party, including any
subcontractor, vendor, or other person that is not a party to the
contract, will lease or furnish any labor, services, material,
equipment, or machinery to, or on behalf of, the real property
improvement supplier in connection with the real property
improvement.
(11) Signature lines for the real property improvement supplier or
the supplier’s agent and for each consumer who is to be a party to
the real property improvement contract with a legible printed or a
typed version of that person’s name placed directly after or below
the signature.
See id.
[8] We pause here to note the internal discrepancy between Section 24-5-11-4,
providing that a real property improvement contract may be oral or written, and
Section 24-5-11-10(a), mandating that the supplier provide the consumer with a
completed contract before it is signed and listing the specific minimum
requirements to be contained in the contract, including signature lines for the
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supplier and the consumer with printed or typed versions of their names.
Further, Section 24-5-11-10(b) requires the contract to “be in a form that each
consumer who is a party to it can reasonably read and understand.”
[9] A panel of this Court recently recognized this discrepancy and determined that,
with its “unmistakable specificity,” Section 24-5-11-10(a) controls. See Logan v.
Evans, 230 N.E.3d 371, 381 n.4 (Ind. Ct. App. 2024) (noting discrepancy,
recognizing tenet that specific statutory provision takes priority over general
one, and concluding that I.C. § 24-5-11-10(a)(10) “specifically and
unambiguously requires that a real property improvement contract be in writing
and signed by both the supplier and the customer”). Accordingly, a real
property improvement contract must be in writing and signed by both parties.
Id. (citing I.C. § 24-5-11-10(a)(10)); see also I.C. § 24-5-11-10.6 (2017) (referring
to contract being signed by consumer and supplier); I.C. § 24-5-11-11 (2017)
(requiring supplier to agree to terms of contract by “written signature” before
consumer signs contract); I.C. § 24-5-11-12 (2017) (requiring supplier to give
“fully executed copy” of contract to consumer “immediately after the consumer
signs it”), and see McGraw Prop. Sols., LLC v. Jenkins, 159 N.E.3d 991, 996 (Ind.
Ct. App. 2020) (stating that Act requires suppliers to provide consumer with
written contract).
[10] In the present case, Mader is undeniably a real property improvement supplier
who was hired by the Balashes to perform real property improvements, the cost
of which exceeded $150. It is also undisputed that Mader never provided a
written contract to the Balashes and that they never signed a contract with
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Mader or executed any documents that would have satisfied the minimum
statutory contract requirements.
[11] Under the Act, it was Mader’s burden to supply the Balashes with a written
contract. See I.C. § 24-5-11-10(a) (“A real property improvement supplier shall
provide a completed real property improvement contract to the consumer before
it is signed by the consumer.”) (emphasis added). Mader failed to do so, and,
as such, he violated the Act. Therefore, Mader cannot enforce the oral
agreement against the Balashes. See Ambrose v. Dalton Const., Inc., 51 N.E.3d
320, 322 (Ind. Ct. App. 2016) (stating that violation of Act makes contract
unenforceable against consumer) (opinion on reh’g), trans. denied.
Consequently, the trial court’s award of damages to Mader is clearly erroneous
and must be set aside. See Cyr v. J. Yoder, Inc., 762 N.E.2d 148, 152 (Ind. Ct.
App. 2002) (setting aside damage award in favor of contractors because they
violated Act by failing to have consumer sign contract). Our holding reflects
our continued mindfulness that the Act was passed to protect consumers from
abuse and that contractors are therefore held to a strict standard. See Benge, 855
N.E.2d at 720.
Conclusion
[12] Thus, in light of the foregoing, we conclude that Mader’s dealings with the
Balashes were governed by the Act and that the damage award entered for
Mader must be set aside.
[13] Reversed with instructions to vacate the judgment for Mader.
Court of Appeals of Indiana | Opinion 24A-SC-792 | October 8, 2024 Page 8 of 9
Vaidik, J., and Brown, J., concur.
ATTORNEY FOR APPELLANTS
Hannah L. England
England Law Office, P.C.
Spencer, Indiana
APPELLEE PRO SE
Steve Mader
Spencer, Indiana
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